Elena Gutierrez, Chpater 2, Question 6

In chapter two Wheelan talks about incentives, and how they can impact an economic system. Incentives can be anything from implementing high taxes on cigarettes to promising a free 3rd good when you buy two. There can be both positive and negative incentives. A positive incentive rewards people finically for their choices And behavior, while negative incentives punish people finically. In chapter two Wheelan talks about how countries implement good policies by introducing positive or negative incentives. Wheelan gives the example of how London's government chose to deal with their traffic, and pollution problems. The city of London starting charging drivers for driving in certain areas at certain times. Year after year the city raised the fees and fines for not paying driving fees. Less and less people chose to drive and more and more people used public modes of transportation. This is an example of how negative incentives (driving fees) can influence behavior and the economy.